Tri Pointe Homes reports Q2 profit decline, repurchases $100 million stock

NEW YORK - Tri Pointe Homes, Inc. (NYSE:TPH) reported second quarter net income of $60.7 million, or $0.68 per diluted share, down from $118.0 million, or $1.25 per diluted share, in the same period last year. The company maintains strong profitability metrics, with InvestingPro data showing a healthy P/E ratio of 7.69 and an impressive return on equity of 13%.

The homebuilder delivered 1,326 homes during the quarter, a 22% decrease from 1,700 homes in the second quarter of 2024. Home sales revenue fell 22.3% to $879.8 million from $1.1 billion a year earlier, while the average sales price of homes delivered remained relatively stable at $664,000 compared to $666,000. This performance aligns with InvestingPro analysis, which highlights 12 key investment factors for TPH, including management’s aggressive share buybacks and strong financial health metrics.

The company’s results included an $11 million inventory-related charge. Excluding this charge, adjusted net income was $68.7 million, or $0.77 per diluted share.

Homebuilding gross margin percentage decreased to 20.8% from 23.6% in the prior-year period. Adjusted for the inventory charge, the gross margin was 22.1%.

New home orders totaled 1,131 during the quarter, down 31.5% from 1,651 in the second quarter of 2024. The company’s cancellation rate increased to 13% from 9% a year ago.

Tri Pointe maintained a strong financial position with a homebuilding debt-to-capital ratio of 21.7% and $1.4 billion in total liquidity, including $622.6 million in cash and cash equivalents.

During the quarter, the company repurchased approximately 3.2 million shares of common stock for $100 million at an average price of $31.37 per share. The board authorized an additional $50 million for share repurchases, increasing the total program to $300 million. According to InvestingPro analysis, the stock appears undervalued at its current price of $35.19, with a Fair Value assessment suggesting significant upside potential. The company’s strong financial position is reflected in its excellent current ratio of 11.86 and moderate debt-to-capital ratio of 0.25.

The company also expanded its credit facility from $750 million to $850 million and extended the maturity date to June 2030.

For the third quarter, Tri Pointe expects to deliver between 1,000 and 1,100 homes at an average sales price between $675,000 and $685,000. Discover comprehensive analysis and detailed metrics in TPH’s Pro Research Report, available exclusively with an InvestingPro subscription, along with in-depth research on 1,400+ other US stocks.

The information in this article is based on a press release statement from Tri Pointe Homes.

In other recent news, TRI Pointe Homes reported stronger-than-expected earnings for the first quarter of 2025. The company achieved earnings per share of $0.70, surpassing the forecasted $0.50. Revenue also exceeded expectations, coming in at $721 million compared to the anticipated $714.65 million. In another development, Wedbush upgraded TRI Pointe Homes’ stock rating from Neutral to Outperform. The firm raised its price target to $43.00, up from the previous $38.00. Wedbush expressed confidence in TRI Pointe’s ability to meet its fiscal year 2025 guidance, highlighting the strength of its core business. The analysis pointed to TRI Pointe’s consistent share repurchase strategy as a significant factor supporting the positive outlook. These recent developments provide investors with key insights into TRI Pointe Homes’ financial performance and market positioning.

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